Government and society

Constitutional framework

Panama has a popularly elected, representative system of government with executive, legislative, and judicial branches. Universal suffrage was instituted in 1907, and Panamanians 18 years of age and older are eligible to vote.

After a coup by the National Guard in 1968, the national legislature was suspended, and Panama was administered by a provisional government led by Gen. Omar Torrijos. A new constitution in 1972, the fourth in Panama’s history, gave Torrijos virtually complete control over the government but also established an elected body, the National Assembly of Municipal Representatives. The constitution was amended in 1978 to provide for a gradual return to democratic government within six years. Further constitutional amendments were approved in 1983, but democracy did not return to Panama until 1990, following the removal of Torrijos’s successor, Gen. Manuel Antonio Noriega Morena.

Under the constitutional revision of 1983, executive power is exercised by the president, who is popularly elected for a nonrenewable five-year term. The president was assisted by two vice presidents—also popularly elected for nonrenewable five-year terms—until 2009, when the second vice presidential position was eliminated. The president appoints a cabinet. A unicameral National Assembly consists of 71 members, who are elected for five-year terms and are eligible for reelection. The assembly initiates legislation, rules on international treaties, approves the budget, and establishes political divisions. After the 1999 election nearly one-tenth of the seats were held by women.

Local government

The country is divided into nine provincias and five comarcas indígenas (indigenous sectors)—Kuna Yala (San Blas), Emberá (Emberá-Wounaan), Kuna de Madungandí (Madugandí), Kuna de Wargandí, and Ngöbe Buglé (Guaymí). The provincias are divided into distritos municipales (municipal districts), which are subdivided into corregimientos (magistracies). The head of each provincia is the governor, appointed by the president. The comarcas are semiautonomous reserves governed by tribal leaders (caciques), but their status under the law has been disputed. In the late 1990s indigenous protestors in some comarcas clashed with the national police while opposing the expansion of industrial sites and roads on the reserves. In addition, some Kuna have attempted to control tourism in the San Blas islands.

Justice

Judicial power rests with a Supreme Court, the nine members of which are appointed for 10-year terms by the president with the approval of the National Assembly. The Supreme Court is composed of separate divisions for civil, penal, and administrative cases. The justice system also includes several types of lower courts.

Political process

Politics in Panama has tended to follow a practice called personalismo, where the primary loyalty is to a strong leader, in some cases extended through allegiance to a spouse or second generation. When elections were resumed in Panama in the 1990s, the traditional liberal and conservative parties gave way to a more varied group, requiring the formation of coalition governments. At the turn of the 21st century the dominant parties were the Democratic Revolutionary Party and the Arnulfista Party. Coalitions have been formed for most elections, including that of 2004, but they often break down during a presidential term.

Security

Military and police forces in Panama have often been synonymous. For several periods during the 20th century, the Panamanian police (or military) took control of the government and oversaw internal security. In addition, prior to 1999 U.S. soldiers intervened occasionally to quell Panamanian civil disturbances. Panama in the 1950s created a paramilitary organization (the National Guard) as the de facto police force, but the guard gradually took on more military roles, and in 1983 it was renamed the Panama Defense Force (PDF). Under the rule of Noriega in the 1980s, various subordinate police agencies and paramilitary organizations operated. The government first created a secret (undercover) police force in 1909, expanded its responsibilities in 1941, and reorganized it in 1960 as the National Department of Investigations (Departamento Nacional de Investigaciones; DENI). In 1989 U.S. troops defeated the PDF (seeInvasion of Panama), and afterward both the PDF and DENI were disbanded.

The national police organizations are now under civilian control and include the Public Force (PF) and the Technical Judicial Police, a special investigative unit. National defense is also entrusted to the PF, which has limited combat capabilities but some military components, including air and naval units. In the late 1990s concern was raised that Panama needed greater resources to secure its border with Colombia (the Darién region), which had become notorious for incursions by Colombian rebels, paramilitary groups, and narcotics smugglers. Panama also lacks resources to control other land, air, and sea frontiers. These issues remain unresolved.

Health and welfare

State-funded hospitals and hospital clinics are supplemented by regional health centres and by mobile medical units. Most permanent employees are eligible for benefits from the social security administration, which maintains hospitals and clinics in Panama City, Colón, and elsewhere. There are some private hospitals.

A social security system, financed by employers’ and workers’ contributions, was established in 1941. It provides old-age, disability, and survivors’ pensions and maternity and medical benefits for workers and their dependents. Its funding is a growing source of political debate.

The vast majority of the working population is protected by a minimum wage law, but salaries and wages may fluctuate widely. By law all workers receive an annual bonus in the form of an extra month’s salary called the décimo tercer mes (“13th month”).

Housing

Panamanians live in housing types that vary greatly according to socioeconomic status. Housing in Panama City ranges from fashionable high-rise condominiums to slum and squatter settlements ringing the city and filling in some of the central districts, where two-story frame houses and low-rise apartment buildings have become tenements. However, conditions in many squatter settlements have gradually improved, as public utilities have been provided and higher-quality building materials employed in individual homes. Wood is increasingly being replaced by concrete in construction in urban areas.

Panama’s Ministry of Housing provides grants and building materials to low-income families, including indigenous groups. The ministry also works with commercial banks to encourage the use of mortgages among middle-class families. In the early 21st century the government promoted residential developments in some of the formerly U.S.-controlled areas near the Panama Canal.

Education

Elementary education is compulsory and free for children between ages 6 and 15. One-third of Panamanians age 25 and older have not completed primary school, yet it is estimated that nine-tenths of the adult population (age 15 and older) is literate. The institutions of higher education include the state-run University of Panamá (founded 1935) and the privately operated University of Santa María la Antigua (1965), both in Panama City; the University of Panamá also has branches in several provinces. A polytechnic university was founded in Panama City in 1981. In addition, some U.S. and other foreign universities offer branch programs in Panama.

Cultural life

Panama’s culture is a blend of African, American Indian, North American, and Spanish influences, which are expressed in its traditional arts and crafts, music, religion, sports, and cuisine. Panamanian music is popular throughout Latin America, and the country is known as well for its many festivals. Other aspects of traditional culture are well preserved, especially by the country’s Indian peoples. Panama is a cultural melting pot, adapting elements from a wide variety of sources and valuing innovation as much as the good things of the past.

Cultural milieu

The cosmopolitan urban culture near the canal contrasts with the rural culture of the savannas. The latter area, with its cattle ranches and horsemanship, is a centre of Hispanic tradition. Old folk songs and handicrafts are preserved there—for example, around the towns of Chitré and Las Tablas. Also culturally distinctive are the territories of the various Indian groups, each with its language and handicrafts, such as the bright smocks (molas) decorated with reverse appliqué panels worn by Kuna women and the netted carrying bags made by the Guaymí. The Kuna have a strong tradition of storytelling (oral literature), including epic poetry that—when written— can extend for hundreds or thousands of lines. Other areas of cultural interest include the Caribbean islands of Almirante Bay, with their Antillean customs.

Panama City’s Historic District is known for its colonial architecture, which dates to the 17th century. In 1997 the district was designated a World Heritage site, as were the old Caribbean coastal fortifications of Portobelo and San Lorenzo in 1980.

Daily life and social customs

Panama has adopted elements of food and culture from South and Central America, the Caribbean (including African influences), North America, Asia, and the Middle East. This is especially true in the areas near the canal where more than half the population lives. Caribbean influence is strongest along the northern coast and among the Afro-Panamanian population, many of whom are descended from English-speaking Caribbean families who came to build the canal. U.S. influence is strongest among the urban middle and upper classes; these groups typically speak English as well as Spanish, increasingly use the Internet and cell phones, have greater opportunities to travel abroad, and consume expensive goods brought in from abroad and sold in some of Latin America’s best-appointed shopping centres. Major economic and social inequalities persist, and most Panamanians in isolated rural areas continue to be poor and to have traditional lifestyles.

Panamanian food reflects the nation’s cosmopolitan background, particularly its Colombian, U.S., and Caribbean influences. Rice, beans, and corn are basic staples, and good use is made of seafood and tropical fruits and vegetables. Arroz con pollo and sancocho, two chicken dishes, are considered national favourites. Chiles and the herb culantro flavour many dishes. Also widespread are Panamanian versions of the seviche, tamales, and empanadas found throughout Latin America. Locally produced beers and rum are the most popular alcoholic beverages, but North American brands dominate the soft drink industry.

Popular entertainment is also a result of Panama’s multicultural heritage. Caribbean rhythms and North American rock are more popular than traditional Hispanic music. Mexican and Venezuelan telenovelas (soap operas) compete with American productions for the television audience.

The arts

Anthropologists and folklorists have published many Kuna stories and poems, in the process creating one of the best-documented bodies of Native American literature. Apart from Panama’s indigenous arts and oral traditions, few artistic achievements were produced in the region prior to independence in 1903. The themes of earlier works were mostly European or church-related. Some progress has been made in national expression since that time—by poets and fiction writers such as Gaspar Octavio Hernández, Ricardo Miró, and Gloria Guardia, among others—and there has been some international recognition of Panamanian artists. Panama’s larger cities are often visited by international musical and theatrical groups and by poets, sculptors, and other artists.

Music in Panama is a lively blend of many styles, including salsa, Cuban son, Colombian cumbia, Argentine tango, and Caribbean island ska, reggae, and soca. Common instruments are drums, castanets, bells, mejoranas (five-stringed guitarlike instruments), and flutes. One of Latin America’s best-known musicians is the Panamanian-born salsa singer and actor Rubén Blades, who ran unsuccessfully for the presidency in 1994. The national dance, the tamborito (“little drum”), features couples moving to a combination of drumbeats.

Cultural institutions

Among the country’s cultural institutions are the Panamanian Art Institute (Panarte), the National Institute of Music, the National School of Music, the National School of Plastic Art, the National School of Dance, and the National School of Theatre. Also of note are the National Commission on Archaeology and Historic Monuments, the National Museum of Panama, and the Panamanian Academy of History. The National Institute of Culture promotes many types of events, including concerts, theatre, and art expositions.

Sports and recreation

The U.S. influence in Panama can be seen in the country’s sports. Basketball is extremely popular, and there are regional teams as well as a squad that competes internationally. Baseball also is played throughout the nation, and many Panamanians have played on professional teams in the United States, including Rod Carew, who was one of the game’s greatest hitters, and Mariano Rivera, a much-praised pitcher. Among Panama’s more prominent boxers are Roberto Durán, who won world titles in four weight classes, and Eusebio Pedroza, who was the featherweight champion for more than seven years (1978–85). Horse racing, cycling, and tennis also are popular. The Panamanian sprinter Lloyd LaBeach won two bronze medals at the 1948 Olympic Games.

Panama features numerous attractive beaches, and snorkelers and scuba divers enjoy its coastal waters (especially around the Perlas and Coiba islands) and the Panama Canal, which contains boat wrecks and discarded equipment used in the waterway’s construction. Surfers frequent Santa Catalina Beach on the Azuero Peninsula, and deep-sea sport fishers are attracted to Piña Bay, which has yielded record catches. Bird-watching is popular in the national parks.

The Panamanian government’s tourism bureau encourages the preservation of traditional holidays, folk music, and folk dances. Panama is known for its joyful, music-rich religious festivals and for boisterous holidays such as its pre-Lenten Carnival, marked by dancing, drinking, and casting away care. Several municipalities sponsor Semana Santa (Holy Week) festivals, notably the small town of Villa de los Santos. Portobelo, a town on the Caribbean coast whose inhabitants are predominantly of mixed African and European ancestry, observes a festival called Cristo Negro (Black Christ). The town of Guararé sponsors the Mejorana festival, dedicated to the folklife of Panama’s rural provinces.

Media and publishing

La Prensa, Crítica Libre, El Panamá Américan, and other major newspapers are published in Panama City. Panama has many radio stations, half of which are located in Panama City. There are three television networks, with several stations. Even when Panama has been under civilian democratic rule, its press has had less freedom than in most Latin American countries, because its defamation laws have effectively shielded prominent figures from stringent criticism. Many politicians have sued Panamanian journalists, and a Peruvian journalist was threatened with expulsion in the late 1990s; however, shortly after the inauguration of Mireya Moscoso Rodríguez to the presidency in 1999, the more stringent libel laws were repealed.

As head of the colony, Balboa, by the use of persuasion and force, brought most of the Indians under submission. Some of them revealed to him that a large sea and a gold-rich empire existed to the south, which perhaps was that of the Inca. In September 1513, Balboa reached the sea and claimed the Pacific Ocean for his king. Returning to Santa María in January 1514, he encountered much resistance from the Indians. Five years afterward Balboa was executed for insurrection on orders of the new governor, Pedro Arias de Ávila, known as Pedrarias Dávila, “the Cruel,” who had distrusted Balboa and feared his rivalry.

In 1519 the population of Santa María moved to the new town of Panama (the first European settlement on the west coast of the hemisphere), which became the centre of commercial activity and the springboard for the conquest of Peru. The colony became an important part of Spain’s mercantile system, attaining the rank of audiencia in 1538. Nombre de Dios, which was resettled and linked to Panama town by road, was renowned for its ferias (grand markets, or trade fairs). With the final destruction of Nombre de Dios in the late 16th century by the Englishman Francis Drake, commercial activity was moved to the hamlet of Portobelo, overlooking the calm bay recorded by Christopher Columbus in 1502. Portobelo then became a centre of Spanish commerce in the New World and the site of great ferias.

Panama town and Portobelo continued to attract the attention of English raiders, however, and disastrous consequences befell both settlements. Henry Morgan destroyed Panama town in 1671, and Admiral Edward Vernon razed Portobelo in 1739. In the year of Vernon’s raid, the colony was reduced in status when Spain abolished the Audiencia of Panama and placed its territory within the Viceroyalty of New Granada. Portobelo was rebuilt in 1751, but by then the Spanish galleons had begun to use the route around Cape Horn, accelerating the city’s decline through loss of trade. In 1673 the town of Panama was rebuilt a few miles west of the old town. By 1793 it was the principal town on the isthmus, with more than one-tenth of Panama’s civilian population of 71,888.

Secession from Spain and union with Gran Colombia

As the agitation for independence grew elsewhere in Spanish America, Panama, dependent on seaborne trade and relatively isolated from mutinous colonies, did not join the insurrection. The viceroy moved his headquarters from Quito (now in Ecuador) to Panama town, which sent deputies to the Cortes (parliament) in Cádiz, Spain, during the Napoleonic Wars. When the Spanish merchants secured the revocation of the royal decree authorizing foreign trade, Panama changed sides. In the autumn of 1821 the colony seceded from Spain and joined the Gran Colombia union. For a time Panama enjoyed the right to elect its own governor, but in 1843 a new constitution returned that power to officials in Bogotá. Soon afterward Panama became a state within Colombia and, despite numerous efforts to break away, remained so for the rest of the century.

Transcontinental railroad and canal projects

In 1847 the Colombian government negotiated the building of a transcontinental railroad by investors in the United States, but political and health problems kept it from becoming operational until 1855. The Bidlack-Mallarino Treaty of 1846 had granted the United States a right-of-way through the isthmus and thus the right to intervene to protect the line and free transit across the continent. Political turmoil raged while construction was under way. Panama inaugurated and discarded 20 governors (also called presidents), while New Granada (now Colombia) elected, substituted, or deposed 7 in Bogotá.

The railroad helped the gold rushers destined for California, U.S., after 1848, but it also encouraged canal planners. Ultimately Colombia awarded the rights to build the canal to the French diplomat Ferdinand de Lesseps (who had been instrumental in building the Suez Canal in Egypt) and his Universal Interocean Canal Company; construction began in 1880. By 1889 disease, chicanery, and financial scandals in France and Bogotá ruined the corporation.

By 1892 Philippe Bunau-Varilla, a French former chief engineer of the canal works, had formed a new canal company, which acquired the assets of the defunct one. After considerable debate, the United States decided to build a canal through Panama rather than Nicaragua, and the U.S. Congress’s Spooner Act of 1902 authorized the U.S. president to buy the assets of the French company. Following up on this, Bunau-Varilla pressured Colombia to negotiate the Hay-Herrán Treaty of 1903, which would have allowed the United States to control a strip of land surrounding the projected canal. The Colombian senate, however, rejected the treaty.

Map of central Panama (c. 1900), from the 10th edition of Encyclopædia Britannica, highlighting the proposed route of the Panama Canal through the isthmus, which was then a part of Colombia. A French company had unsuccessfully attempted to construct a canal in the late 19th century; the United States completed the waterway in 1904–14, largely tracing the route shown here.Encyclopædia Britannica, Inc.

Bunau-Varilla then turned to a group of Panamanian revolutionaries who were uniting in opposition to the Colombian government’s rejection of the canal treaty, its requisitions of property, and its impressment of Panamanian men during a civil war. On November 3, 1903, a revolutionary junta proclaimed Panamanian independence. Colombian forces were sent to crush the rebellion, but they were mired at Colón because the U.S.-administered railroad had strategically removed its trains from the northern terminus. U.S. naval forces also deterred reinforcements that were sent from Bogotá by land. The secessionist junta appointed Bunau-Varilla minister to Washington, D.C., with full powers to negotiate treaties. On November 18, 1903, he and U.S. Secretary of State John Hay signed the Hay–Bunau-Varilla Treaty. By this treaty the United States obtained, in perpetuity, the exclusive use, occupation, and control of the Canal Zone, a strip 10 miles (16 km) wide (5 miles on each side of the waterway). Formal acquisition of the lands took place on May 4, 1904. Construction of the canal resumed that summer, and it was opened on August 15, 1914.

The Republic of Panama

Early years

The new constitution authorized the United States to intervene militarily in Panama in order to quell disturbances. It also provided for a centralized government headed by a president who had the authority to appoint and dismiss provincial governors. Manuel Amador Guerrero became the first president, and universal suffrage was adopted in June 1907. As had been the case under Colombian government, traditional Liberal and Conservative parties dominated politics, but personalities and family ties proved more important than ideology in most contests. Political and economic unrest brought bloodless military interventions by the United States in 1908, 1912, 1918, and 1925.

In January 1931 the government of Florencio Harmodio Arosemena was overthrown in a bloody coup led by Arnulfo Arias Madrid, a charismatic populist unconnected to the traditional political elites. The United States acquiesced and promptly recognized as president the minister to Washington, Ricardo Alfaro, who presided over orderly elections in 1932, when Harmodio Arias Madrid (brother of Arnulfo) was the winner.

The new president persuaded the United States to relinquish its rights of intervention and of seizing lands for canal-related purposes, and the Hay–Bunau-Varilla Treaty was thus modified in 1936 by the Hull-Alfaro Treaty. In addition, the United States increased the annuity paid for the use of the Canal Zone and agreed to build a transisthmian highway. The Arias brothers soon fell out, however, and Arnulfo began his own quest for the presidency, which he won in June 1940. He then changed the constitution to extend the length of his term.

World War II and mid-century intrigues

Before the United States became embroiled in World War II, it requested defense sites outside the Canal Zone for landing fields, roads, antiaircraft batteries, and warning stations. Arias, who openly sympathized with fascism, demanded compensation in the form of cash and the transfer to Panama of various properties. While in Havana, Cuba, on a private visit, he was removed from office by the national police (Panama had no army) in October 1941, and Ricardo Adolfo de la Guardia became president. After the Japanese attack on Pearl Harbor, Hawaii, on December 7, 1941, Panama transferred the defense sites to the United States, and tens of thousands of U.S. troops were stationed there to guarantee the security of the canal. While the waterway was never actually attacked, Japan had planned to do so, intending to use aircraft launched from submarines; however, the war ended before this effort could be mounted.

During and after the war the United States eventually returned 98 defense sites to Panama but continued negotiations on 36 others. The Panamanian government finally agreed to lease the sites, but the Panamanian National Assembly, influenced by the threat of mob violence, rejected the proposals. The United States abandoned the additional bases in 1947.

In 1945 the National Assembly put an end to the regime of de la Guardia, sent him into exile, and selected the ambassador to Washington, Enrique A. Jiménez, as president. In the presidential elections of 1948 Domingo Díaz Arosemena was declared the winner by the National Jury of Elections, depriving Arnulfo Arias of a victory. Díaz died in office in 1949, and, under a mountain of popular protests, his two vice presidents first accepted and then refused office. This action cleared the way for a bizarre maneuver by the election jury, which declared that, after a recount, Arias had won the presidency in 1948. Politics throughout this period were dominated by Colonel José Antonio Remón Cantera, commander of the increasingly militarized police, which became known as the National Guard.

In 1951 former president de la Guardia returned from exile and began to challenge the government. In May there was a run on the Federal Trust Company savings bank, which was subsequently closed; de la Guardia protested the closing and was therefore arrested. Then on May 10 Colonel Remón turned against Arias, who was overthrown, and Vice President Alcibíades Arosemena assumed power the following day. Remón won the presidential election of 1952 but was assassinated in January 1955.

The year 1955 was also notable for the flow of capital into Panama, including a loan from the World Bank that supported work on the Inter-American Highway and on local roads. But martial law was imposed in 1958 following student riots against the regime of Ernesto de la Guardia (elected in 1956) and against the United States. There were more disturbances during the first four months of 1959, and on Independence Day men said to have been students marched into the Canal Zone to raise the Panamanian flag. The police turned them back.

In the presidential election of 1960, Roberto F. Chiari emerged victorious. Despite a national debt of about $83 million and a budget deficit of some $10 million, he plunged into a vast program of slum clearance, housing, hospital construction, and health service. Arnulfo Arias also championed those efforts, and he became a front-runner in the presidential election of 1964; however, the National Guard intimidated voters who wished to support Arias, and the former secretary to the National Guard, Marco A. Robles, was declared the winner. Under Robles the economy of Panama was uneven. In January 1964 anti-U.S. riots were sparked when high school students in the Canal Zone used force to prevent the display of the Panamanian flag. In response to this action, Panama broke relations with the United States and attempted to take the dispute to the United Nations (UN) Security Council. These events led to reduced income from the Canal Zone and worried foreign investors, and unemployment became a serious problem. Eventually the United States agreed to renegotiate the Canal treaties, including setting a date for Panama to assume control over the canal and the adjacent Canal Zone. There were additional disorders in March and May 1968, when Arias, a presidential candidate, with his followers in control of the National Assembly, unsuccessfully attempted to impeach Robles.

Arias won the election, but after 11 days in office he was removed from power by the National Guard, which took control of the government. A ruling junta then instituted censorship of the press, suspended constitutional guarantees, and dissolved the National Assembly.

By degrees, Colonel (later General) Omar Torrijos Herrera emerged as the leader of Panama. The constitution was again changed to strengthen and enlarge his powers. In 1972 a new national assembly, whose members were selected by Torrijos, gave him full executive powers and allowed him to rule as a dictator. Torrijos, behind a facade of popular government, transformed the appearance of Panama City through spectacular public works programs. The cost of these programs, however, plunged the country into heavy debt, and by 1977 an economic crisis loomed. Meanwhile, the dictatorship appointed and dismissed puppet presidents at will. In mid-1978 Torrijos obtained U.S. approval for the Panama Canal treaties (see Treaty relations with the United States), and this apparent triumph seemed to promise economic respite. He also agreed to U.S. requests to allow the exiled shah of Iran to enter Panama.

On July 31, 1981, Torrijos was killed in a plane crash, and a succession of colonels took command of the National Guard. In March 1982 Colonel Rubén D. Paredes became commander of the guard. When he resigned in September 1983 to pursue the presidency, control of the military and ultimately the country went to Colonel Manuel Antonio Noriega Morena, former head of intelligence.

Noriega renamed the National Guard the Panama Defense Force (PDF) and consolidated the dictatorship of Torrijos. He increased the size of the armed forces, harassed journalists, and ultimately created a paramilitary force to intimidate his opponents. The military retained control of customhouses, post offices, the Colón Free Zone, and other state-run enterprises. Also ominous was Noriega’s reported involvement in the narcotics traffic in collusion with Colombian drug cartels.

In 1984 Noriega permitted the first presidential elections in 16 years. Arias was the apparent winner, but after many delays in the vote count and suspected tampering, Nicolás Ardito Barletta, Noriega’s candidate, was proclaimed president. Eleven months later, Noriega deposed Barletta, who had dared to disagree with him, and replaced him with the first vice president, Eric Arturo Delvalle. In June 1987 riots erupted when the second in command of the PDF, Colonel Roberto Díaz Herrera, publicly accused Noriega of drug-related activities, murdering opponents, and rigging elections. In February 1988 Delvalle attempted to dismiss Noriega, who was being publicly condemned by factions within and outside the country. In the United States, Noriega was indicted in the same month on counts of drug trafficking and racketeering. Delvalle’s action resulted in his own dismissal, by orders of the Noriega-dominated National Assembly, and he was forced to take refuge on a U.S. military base, from where he continued to claim that he was the legal president.

U.S. President Ronald Reagan refused to recognize Delvalle’s successor, and in March 1988 he imposed sanctions, including the elimination of preferential trade for Panama and the withholding of canal fees. On March 16 an attempted military coup failed to overthrow Noriega, and paramilitary groups intensified their repression of antigovernment demonstrators.

Invasion of Panama

In the presidential election of May 1989, Guillermo Endara Galimany and his two vice presidents won by a wide margin, but their supporters then suffered brutal physical assaults by Noriega’s forces, an event widely reported by the international press. Noriega canceled the election results. This only exacerbated popular and international discontent with the dictatorship, but Noriega remained impervious to criticism. On September 1, 1989, he installed a classmate as president, but his desire to remain in power seemed to intensify in October, after he foiled another coup attempt. On December 15, 1989, Noriega sought and was given by the legislature the title of chief executive officer of the government. The Noriega-led assembly declared that a state of war with the United States existed. The next day Panamanian soldiers killed an unarmed U.S. Marine officer dressed in civilian clothes.

Retaliation by the United States was quick and decisive. On December 17, U.S. President George Bush ordered troops to Panama, with the subsequently announced aims of seizing Noriega to face drug charges in the United States, protecting American lives and property, and restoring Panamanian liberties. The initial attack took place in darkness on the morning of December 20 and was focused primarily on Noriega’s headquarters in Panama City. U.S. forces quickly overcame most organized resistance, but in the following days numerous Panamanian soldiers and civilians looted shops in Panama City and Colón, and some 2,000 U.S. reinforcements were flown in to help establish order. The number of Panamanians killed in the operation was estimated at 200–300 combatants (soldiers and paramilitaries) and more than 300 civilians; 23 U.S. soldiers also were killed. Hundreds from both nations were wounded.

On the first day of the invasion, Endara and his two vice presidents were sworn in to head the government of Panama. Noriega took refuge in the Vatican nunciature (embassy) in Panama, until he surrendered to U.S. authorities on January 3, 1990, and was then transported to Miami, Florida. There he stood trial, was convicted on a host of charges, and was sentenced to a U.S. prison. In Panama and also France, Noriega was charged with various crimes, including murder, but no enduring efforts were made to have him extradited.

Transitions to democracy and sovereignty

The new Endara government began as a broad coalition, but it soon broke up with the expulsion of the largest party, the Christian Democrats (Partido Demócrata Cristiano; PDC), led by Vice President Ricardo Arias Calderón. This left the administration without a legislative majority and allowed the remnants of Noriega’s Democratic Revolutionary Party (Partido Revolucionario Democrático; PRD) to regain some political power. As a result, accomplishments were meagre at best. A package of reforms, including constitutional amendments, was defeated in a referendum, as unemployment soared and corruption remained widespread. The administration succeeded in abolishing the PDF and replacing it with a new national police known as the Public Force, and it amended the constitution to prohibit the creation of a regular military; the amendment was ratified in October 1994.

The 1994 presidential and legislative elections produced a proliferation of candidates, opening the door for a return to power by the PRD. Led by Ernesto Pérez Balladares, a former cabinet member, the PRD distanced itself from Noriega, and Pérez Balladares won by a plurality. In the assembly the Christian Democrats, who had been the largest bloc, were reduced to a single seat.

The Pérez Balladares administration worked to maintain relations with the United States and to reform the economy. It privatized several government enterprises, including the telephone system, reduced trade barriers, and encouraged private investment. In addition, it reduced unemployment and crime rates and began an ambitious program of highway construction. Pérez Balladares also accepted refugees held by the United States who could not be housed in existing U.S. military facilities at Guantánamo Bay, Cuba. But he had difficulties regarding the reversion of U.S. military bases and the canal to Panama at the end of 1999. Contracts in these areas were controversial, with charges of corruption and of excessive Chinese influence. Relations with the United States deteriorated when the two nations failed to establish a new drug interdiction headquarters, which would have kept some U.S. troops in Panama. The spread of conflict across the border from Colombia also raised concerns about the ability of a demilitarized Panama to control its land, sea, and air frontiers. In 1998 a referendum was defeated that would have allowed Pérez Balladares to seek reelection. This opened the door to Mireya Moscoso Rodríguez, widow of Arnulfo Arias, and to the Arnulfista Party’s successful campaign in the 1999 elections. Taking office in September 1999, Panama’s first woman president pledged nonpartisan administration of the canal, continued prohibition against regular military forces, and greater attention to the needs of the poor, especially in rural areas. Her administration, however, was characterized more by corruption and favouritism than by any positive accomplishments, and its popularity plummeted.

In 2004 the PRD again returned to power, this time with the support of the remnants of the Christian Democratic Party, now known as the Popular Party (Partido Popular). The newly elected president was Martin Torrijos, the illegitimate son of the former military dictator. Under his administration Panama experienced high levels of economic growth and a decrease in poverty rates, and voters approved a referendum to expand the canal. Work on the canal began in September 2007. But issues of public security, corruption, and government inefficiency remained and continued to generate both domestic and international concern. In the May 2009 presidential election, conservative candidate Ricardo Martinelli defeated the PRD’s candidate, Balbina Herrera.

The Panamanian economy thrived under Martinelli, experiencing average annual growth of 8 percent and record-low unemployment during his tenure in office, but by the end of 2010 some Panamanians had begun questioning his policies and his authoritarian manner. . In August 2011 Martinelli removed Vice President Juan Carlos Varela of the Panameñista Party from the post of foreign minister (he remained vice president), marking the end of the coalition that had brought Martinelli to power. Conflict between the two politicians had erupted over proposed constitutional reforms that would have replaced the country’s first-past-the-post presidential electoral system with one that would require a runoff if no candidate won an outright majority. The next year Martinelli filed suit against Varela, claiming that his former ally had slandered him by accusing the administration of corruption related to a bribery scandal involving an Italian company’s alleged attempts to secure lucrative government contracts. Revenge was ultimately Varela’s, however, when he won the May 2014 presidential election, defeating the candidate that Martinelli had handpicked as his successor, José Domingo Arias, as well as Juan Carlos Navarro, a former mayor of Panama City.

In April 2016 the international media turned its attention to Panama when more than 11 million documents (quickly dubbed the “Panama Papers”), allegedly leaked from the secretive Panamanian law firm Mossack Fonseca, revealed how 12 current or former world leaders as well as dozens of other politicians, public officials, and celebrities throughout the world had used tax havens to hide their wealth.

Throughout the years of Panama’s independent existence, treaty relations with the United States have been subjected to several major changes. By the protocol of 1936, the United States yielded its right to seize additional land for its administration or defense of the canal. At the same time, the United States was pressured to pay a higher annuity for the canal because of the worldwide economic depression of the 1930s and the U.S. departure from the gold standard. In 1953 the annuity was again raised and U.S. landholdings decreased, opening the door for Panamanians to build roads across the isthmus and to manage sanitation. Panamanian security forces began patrolling the canal’s dams and watersheds in the 1940s.

In 1958 the U.S. Congress appropriated funds for a bridge across the canal, and an instrument of transfer was signed that conveyed to Panama real estate with a value of about $25 million. In 1958–59 there were serious disorders and demands to fly the Panamanian flag in the Canal Zone, leading U.S. President Dwight D. Eisenhower to declare that titular sovereignty over the zone resided with Panama; he also ordered that flags of both nations be displayed at specified places in the zone.

In January 1964, U.S. and Panamanian schoolboys engaged in a scuffle over flying their national flags at Balboa High School, which was inside the Canal Zone. Several thousand people turned the melee into a riot that killed more than 20 people and brought injuries to scores of others. Panama blamed the Americans, severed relations, and demanded reparations. The United States, in turn, rejected the accusations and charged Panama with inciting the riot. An International Commission of Jurists later upheld (with a minor exception) the U.S. contentions.

Negotiations between the United States and Panama during the first part of the Robles administration led to three new protocols, signed in June 1967. The first protocol abrogated the accord of 1903, reduced the size of the Canal Zone, and provided for joint operation of the canal. The second protocol continued the responsibility of the United States for the Canal Zone’s defense, and the third protocol provided for a possible sea-level canal. These proposals were not ratified, because they aroused objections from many affected quarters.

In September 1970 Torrijos formally notified the United States of his rejection of the agreements of 1967, but seven months later he moved to resume negotiations. Panama succeeded to one of the two hemispheric seats on the UN Security Council, and its delegate in March 1973 introduced a resolution urging continued negotiation under the auspices of the UN. The United States vetoed the resolution. The Panamanians continued to press their cause in negotiations that resulted in a set of principles (1974) to serve as guidelines for a new treaty; one of these was that U.S. control over the canal and zone would be limited in duration.

The U.S. Congress in 1974 and 1975 was hostile to the proposed ultimate transfer, but Torrijos was able to apply pressure in various ways. If there was not a peaceful settlement, he declared, then there would be violence; this produced in Congress the abhorrent spectre of “another Vietnam.” To further intimidate the opposition, Torrijos, with a considerable entourage, paid a visit to the Cuban leader Fidel Castro in January 1976.

The U.S. presidential elections of 1976 delayed the treaty conversations, but after the election of Jimmy Carter progress was rapid. Agreement was announced in August 1977, and Carter and Torrijos signed the documents the next month. The treaty did not have popular support in the United States, but the Senate ratified it in March 1978. The new basic treaty provided for gradual transfer of the operations of the canal to Panamanians, the phasing out of U.S. military bases, and reversion of lands and waters used in the management of the canal. Similarly, Panama was to assume jurisdiction over the zone by degrees and take over most tasks related to its security. A second pact promised an open and neutral canal for all nations, both in times of peace and war.

The transfer was to be completed by December 31, 1999, but, in ratifying the treaties in March and April 1978, the Senate attached reservations that extended U.S. rights to defend the canal beyond that date and to maintain limited rights to intervene. Panama had approved the treaties in a national plebiscite in October 1977, and the signing ceremonies were observed on June 16, 1978, in Panama City. The U.S. Congress passed legislation to implement the treaties in September 1979, and the treaties went into effect on October 1. In the 1990s, after negotiations failed to permit a continued U.S. military presence in Panama after the turnover date, the United States began a rapid withdrawal, returning to Panama vast tracts of territory. By late 1999 all U.S. troops were withdrawn. Symbolic transfer ceremonies were held on December 14, and on the last day of the year Panama assumed full control of the canal.

Inspire your inbox –
Sign up for daily fun facts about this day in history, updates, and special offers.

By signing up for this email, you are agreeing to news, offers, and information from Encyclopaedia Britannica.
Click here to view our Privacy Notice. Easy unsubscribe links are provided in every email.

Thank you for subscribing!

Be on the lookout for your Britannica newsletter to get trusted stories delivered right to your inbox.